The astronomical prices of assets in CryptoKitties– a game featuring collectible, cryptographically unique cats– have been generating headlines since it debuted last year. The rarest type of cats on the platform sell for hundreds of thousands of dollars. The reason: only a very small number of them exist. Unlike bitcoin and other cryptocoins, each cat is non-fungible or, in other words, cryptographically unique. To put it another way, there’s no way to duplicate or copy and paste one.
Some collectors that got involved in CryptoKitties early on were able to reel in substantial profits. Last year, The Verge interviewed a software designer named Todd who made over $40,000 worth of ether by trading CryptoKitties. Another CryptoKitties collector told The Token Daily that he once quintupled the value of his initial 10 ether CryptoKitties purchase by flipping a rare Founder Cat.
Though the CryptoKitties market seems to have cooled down recently, newer collectible platforms could bring crypto-collectibles into the mainstream. There are now well over 50 crypto-collectible platforms. Some are equipped with advanced features and graphics that could generate even more crypto-collectible mania. Read on to find out everything you need to know to join the fray.
Almost all crypto-collectible platforms use a free Chrome plugin called MetaMask to facilitate crypto transfers. To get it, just go to MetaMask.io and follow the instructions.
During the setup process, the installer will give you a set of seed words. The seed words provide the only way to recover your MetaMask account if you forget your password– so be sure to copy them down and save them somewhere safe.
Trade some fiat money for crypto
If you don’t already have ether for your MetaMask wallet, you’ll need to get some. 15 dollars’ worth of ether is enough to get started on most crypto-collectible platforms.
An easy way to get ether is via MetaMask. Just click the deposit button and then choose Coinbase to buy ether with a credit card. Credit card purchases are expensive compared to bank account transfers. However, if you’re only buying a small amount of ether those added costs won’t hurt you.
After you gain some experience and figure out how crypto-collectibles work, you may want to add larger sums of ether to your account. The most cost-effective way to trade large amounts of fiat for crypto is through a full-featured cryptocurrency exchange. Coinbase offers some good features, but cheaper ways to buy are out there. Learn more about cryptocurrency exchange fees at the link below.
Pick a crypto-collectible platform
This part of getting started with crypto-collectibles presents a difficult decision. There are many crypto-collectible platforms already, and new ones hit the market all the time. Yet, there’s no way to tell which crypto-collectibles will pick up steam going forward and which ones will fade away to obscurity. However, asking these questions about each crypto-collectible market that you’re considering will likely lead you to a better decision.
How much effort is required?
Some crypto-collectibles– like CryptoPunks, for example– are bought and sold like typical real-life objects. All collectors have to do is buy them and hope that their prices go up. Other crypto-collectibles– like Ethermon and Mytherium, for example– integrate with other games. If you don’t like video games, you may want to avoid these types of crypto-collectibles, since you have to use them on a regular basis to get the most value out of them. Learn more about the different types of crypto-collectible platforms at the link below.
How active is the market?
New and buzzworthy crypto-collectible platforms generate hype. That hype can create the ideal market for flipping. But once the initial hype evaporates, flipping may not be a viable option. For example, at one point the CryptoKitties site attracted over 10,000 daily visitors. Today, only roughly 300-400 people log in every day according to DAppRadar. Until the CryptoKitties market picks up again, other crypto-collectible marketplaces may offer better flipping opportunities.
How much money is required?
Even brand new crypto-collectible markets can be pricey. For example, a new digital playing card game called Gods Unchained isn’t even playable yet. Nevertheless, an auction for Hyperion– one of the game’s rarest cards— ended in a 146.28 ether sale. In other words, someone paid over $30,000 dollars’ worth of cryptos to acquire it. The question now is: will the price of Hyperion increase or decrease going forward? There’s no way to tell for sure yet, since the actual game isn’t live. If Gods Unchained delivers on its promises and the card turns out to be powerful, its price will go up. But if the card turns out to be a dud or if the game is too buggy to play at first, whoever bought it might be forced to sell it for a loss.
Who’s behind the project?
Crypto scammers stole $1 billion worth of cryptos from gullible investors last year. Don’t be a statistic. Before you put money into any blockchain-related project, investigate the development team behind it and look for signs of illegitimacy. Fake social media profiles, shabby websites and short, superficial white papers are a few of the red flags that may indicate that the project isn’t what it seems.
Buying, Selling and Trading
There are two main ways to buy, sell and trade crypto-collectibles: directly from the developer and via various crypto-collectible marketplaces.
One way to buy crypto-collectibles is through the official site of whatever collectible you want to buy. This method’s main advantage is simplicity. Making your purchases this way is straightforward and the process is almost always the same. Usually, all you have to do is click on the crypto-collectible you want to buy. Then, you use MetaMask to send the appropriate amount of ether to the website.
However, there is one significant downside to buying crypto-collectibles straight from the source: you’re often limited to buying randomized packs. The Gods Unchained website is a good example of this. There’s no way to buy specific cards unless you participate in a card auction.
Crypto-collectible marketplaces provide virtual venues for crypto-collectible trading. They’re the digital equivalent of the real-life expos and roadshows where collectors of baseball cards, Beanie Babies and other goods go to make deals. Most support a wide variety of collectible crypto assets, ranging from game-related tokens to digital art to virtual real estate. Here’s a high-level look at a few of the most popular options.
OpenSea is one of the largest and most popular crypto-collectible marketplaces on the internet. Supported crypto-collectibles include many of the major platforms, including CryptoKitties, Gods Unchained and Decentraland.
A useful menu on the left side of the screen displays all the supported platforms along with the number of collectibles that are available for purchase. A new update to the site lets collectors trade not only individual collectibles, but also crypto-collectible bundles. Another convenient aspect of OpenSea is that you can still access and use your collectibles if you put them up for sale.
The OpenSea interface is easy enough to use. If you use the “Buy Now” option, all you have to do is click the collectible you want to purchase and then use MetaMask to finalize the transaction. Alternatively, you can use the auction feature to try to get a better price. If you win the auction, you can collect your crypto-collectible.
The main downside of OpenSea is the cost. OpeaSea absorbs 2.5% of every successful sale.
Rare Bits is newer and smaller than OpenSea. However, it may be worth a look if you plan on buying any of the 20 crypto-collectible platforms that it supports because it currently doesn’t charge any sort of fees.
The Rare Bits interface looks very similar to OpenSea’s and is equally easy to use.
OPSkins is an online marketplace for Counter-Strike skins that also supports other Steam games and several popular gaming-oriented crypto-collectibles. Supported crypto-collectibles include CryptoKitties and Etherbots.
If you have valuable Steam collectibles that you aren’t using, OPSkins could be worth a look because it gives you a way to trade them in for crypto-collectibles. Another benefit is that OPSkins accepts fiat payments and withdrawals. OpenSea and Rare Bits don’t support any type of government-issued currency.
On the other hand, OPSkins’ list of supported crypto assets only includes a few platforms. If you’re not interested in those, you’re better off using OpenSea or Rare Bits.